Samsung Electronics saw its shares jump more than 6% in Seoul trading on Thursday, touching intraday gains of up to 7.6%, after the company and its labor union reached a last-minute tentative wage deal late Wednesday. The agreement halted a planned 18-day strike that was set to begin on May 21 and threatened to disrupt operations at the world’s largest semiconductor fabrication complex.
The provisional deal, brokered with the help of South Korea’s Labor Minister Kim Young-hoon, came just 90 minutes before the midnight deadline. It includes a new performance bonus system directly tied to the profitability of the company’s chip division. Workers will receive bonuses funded by 10.5% of the division’s operating profit, paid in company stock rather than cash. Employees can sell one-third of the shares immediately, while the remaining two-thirds must be held for up to two years. The bonus pool will be split 40% to the chip division level and 60% to individual business units. Annual profit targets have been set at 200 trillion won for 2026–2028 and 100 trillion won from 2029–2035.
The union had initially demanded bonuses equal to 15% of operating profit, along with the removal of payout caps and formalized bonus structures written into contracts. The final agreement also includes an average wage increase of 6.2% for 2026, enhanced child support payments, and better housing loan benefits. Union members will vote on the deal between May 22 and May 27, while Labor Minister Kim cautioned that “there is still a long way to go before the final agreement.”
Samsung’s stock was also buoyed by Nvidia’s strong overnight earnings report, which showed revenue of $81.62 billion—an 85% year-over-year increase—boosting sentiment across global semiconductor stocks. The South Korean government had estimated that an 18-day strike could cause direct losses of 1 trillion won and broader economic damage up to 100 trillion won if chip production disruptions forced the scrapping of in-process wafers.
Reactions among workers were mixed. While some expressed relief that the strike was avoided, others in less profitable divisions, such as foundry operations, voiced frustration over the bonus structure. Some memory chip unit employees are reportedly set to receive bonuses of around $416,000, while colleagues in logic chip manufacturing will receive far less. This has widened divisions and spurred some workers to consider switching to rival SK Hynix, which last year paid performance packages three times larger than Samsung’s. Local businesses near the Pyeongtaek campus remained cautious about the economic boost, as much of the bonus will be paid in shares rather than spendable cash.
